Short definition

In trading, short describes a trade that will incur a profit if the asset being traded falls in price. It is also often referred to as going short, shorting or sometimes selling.

Shorting is the opposite of going long, or trading to incur a profit if your market increases in price.

The most well-known method of shorting is short selling. There are two main methods of short selling:

When a trader borrows an asset they do not own from a broker and sells it on the market. Usually the borrowing and selling of the asset is taken care of by the broker.

Derivatives such as CFDs enable traders to open short positions that do not require borrowing the underlying asset.

As an asset could theoretically increase in price indefinitely, short selling requires careful risk management to prevent losses from overrunning. Find out more about managing risk.

With IG

We offer a variety of different ways to trade on markets that are moving lower in price. For example you can trade CFDs on a variety of markets, including traditional assets such as shares, indices and commodities.

All forms of investments carry risks. Such investments may not be suitable for everyone and can result in losses that exceed deposits, so please ensure that you fully understand the risks and costs involved by reading theRisk Disclosure Statement.

IG provides an execution-only service. The information herein does not take into account the specific objectives, financial situation or particular needs of any person. Where in doubt, you should seek advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

IG Asia Pte Ltd (Co. Reg. No. 200510021K) holds a capital markets services licence from the Monetary Authority of Singapore for dealing in securities and leveraged foreign exchange trading and is an exempt financial adviser. It is also licensed by Enterprise Singapore to trade CFDs on commodities.

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